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February 2022 StreetSmarts Newsletter
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How do we grow forward?
March 8, 2022
The biggest surprise of the past year is how quickly the economy recovered after a near economic shutdown. Those who predicted a “V” recovery were mostly right. Notwithstanding the continued up and down scourge of the COVID variants, supply chain chokeholds and political uneasiness, 2021 was characterized by a surprisingly strong economic recovery.
From a real estate point of view, it was as if the players were waiting on the sidelines for the field to be cleared. And then BOOM (my ode to the recently departed John Madden), most everyone returned to the game.
Read the Full 2022 Report
Our Regional Trends Report is an annual publication building on ULI’s Emerging Trends in Real Estate Report. With contributions from local member experts, the report provides insight and analysis on where the San Diego-Tijuana market is heading in the months ahead.
This Trends report is a tale of two stories: one is the rapidity of the recovery, the availability and the bargain of capital, the eagerness of public agencies to entitle, and the willingness of consumers to come out of their hiding places and spend.
The other story is the rapid adjustment, stemming from a presumed post-COVID environment, in how entrepreneurs intend to respond to the changing marketplace for the built environment. How we work, reside and shop were all up for redefinition throughout the past year, resulting in experimentations on what the new built environment can look like.
Throughout 2021 it felt like people were stumbling over one another to get back to making deals, to tear down something, to build something else. And to do it in a way that is unprecedented in terms of the sheer volume, and type of, activity.
Last year I suggested that the economic recovery begins with the inoculations. That was mostly right, except that the recovery began with the mere prospect of the vaccine being stuck in most of our arms. We never did convince everyone (although in San Diego County the vaccination rate has been significantly higher than in most other places), but enough persons have received the vaccines that the markets reacted as if COVID was over.
It wasn’t’ and it isn’t. But the prospect that there is a path to endemic, or a tolerance to just live with it, was sufficient for most to charge forward. The “end of pandemic” in June was followed by the more serious Delta variant in August and, as of this writing, the presumed less serious but more contagious Omicron variant. In our own particular and disparate ways, we have decided as a society that we are going to cope with it and get back to business as normal. Or at least as ‘normal’ redefined.